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topics of interest to you

Halloween liabilityHalloween can be scary but having the right insurance coverage can take some of the fright out of the night, according to the Insurance Information Institute (I.I.I.).

“If you’re worried about Halloween partyers who may cause damage to your home, there’s probably little to fear,” said Michael Barry, vice president, Media Relations, I.I.I. “But do contact your insurance professional with questions or concerns about your homeowners or renters insurance policy.”

Your insurance policies provide financial protection for a host of disasters whether they occur on Halloween or any other day.

The I.I.I. points out that standard homeowners and renters insurance will provide coverage for the following.

  • Vandalism - In the event your home or your personal possessions are damaged by neighborhood tricksters, homeowners and renters insurance policies provide coverage for vandalism and malicious mischief. You are on your own, however, when it comes to removing the toilet paper from your front yard….
  • Fire - If a jack-o-lantern, or other decoration, goes up in flames and damages your property, your homeowners or renters policy will cover fire-related losses. And, should the blaze make your home uninhabitable, additional living expenses (ALE) coverage will pay for alternate accommodations, such as a hotel, while your home is being repaired.
  • Injuries - The liability portion of a homeowners or renters policy comes into play if a Halloween party guest, or a trick-or-treater is injured while at your house or apartment. These policies also include no-fault medical coverage so the injured person can file their claim directly with your insurer.And if Fido gets a little skittish from all the commotion and accidently nips a trick-or-treater your liability coverage includes damages or injuries caused by pets.

Of course, the best solution is to avoid trouble altogether. Check out Safe Kids Worldwide and the Centers for Disease Control and Prevention (CDC) for helpful Halloween safety tips. 

Source:  Insurance Information Institute

Differentiating between an employee and an Independent Contractor can be complicated, but making an error can also be costly.  The Massachusetts Department of Unemployment Assistance (MADUA) recently issued guidance to help clarify the requirements of an Independent Contractor as outlined in the 3-Prong ‘A-B-C test.’  

Proper classification of workers, and subsequently paying applicable unemployment insurance, is at the forefront of maintaining the Unemployment Insurance Trust Fund. Unemployment Insurance was implemented to stabilize the economy by providing temporary income assistance to eligible workers that have lost their jobs through no fault of their own.  Appropriate contributions by employers is vital to the success of the program.  Additionally, misclassified workers do not receive other rights and benefits they are entitled to as employees.   

Before classifying your employees or issuing a Form 1099-MISC, the MADUA strongly suggests that businesses review the relevant statute below for guidance.  

The statute governing Unemployment Insurance, Massachusetts General Law (MGL) c.. 151A, § 2, sets forth the requirements for an individual to be recognized as a legitimate Independent Contractor in Massachusetts for purposes of unemployment insurance. The text of the statute is as follows:

Service(s) performed by an individual shall be deemed to be employment, unless and until it is shown that— 

(a) such individual has been and will continue to be free from control and direction in connection with the performance of such services, both under his contract for the performance of service and in fact; AND 
(b) such service is performed either outside the usual course of the business for which the service is performed[1] or is performed outside of all the places of business of the enterprise for which the service is performed; AND
(c) such individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed. 

All 3 prongs of this ‘A-B-C Test’ must be met for proper classification of an Independent Contractor, regardless of any agreement between the parties. If the test is not met, the worker must go on payroll with wages reported to the appropriate agencies. Each worker must be analyzed independently, as the facts and circumstances may change from individual to individual.  

Additional information is available online at https://www.mass.gov/unemployment-insurance-ui-online and https://www.mass.gov/service-details/independent-contractors. Businesses that have questions can contact the Massachusetts Department of Unemployment Assistance at (617) 626-5050 or the Attorney General’s Fair Labor Division at 617-727-3465.

[1] Note that MGL c. 149, § 148B, the Massachusetts wage law, has a slightly different (b) prong, in that it omits the alternative test, and only focuses on whether the service performed is outside of the usual course of business.

Source:  MA Department of Unemployment Assistance

Don't risk financial losses because someone else isn’t covered

Despite the legal requirements in 49 states, many drivers in the U.S. remain uninsured. Don't risk your financial health—make sure you're insured, and learn how to protect yourself in the event of an accident with an uninsured motorist.

Uninsured motorists are relatively common

With the exception of New Hampshire, every state in the U.S. has a minimum mandatory car insurance requirement. Despite that, about one out of every eight drivers does not carry auto coverage; in some states, that number is one out of five.

car crashIf you’re involved in a serious accident with a motorist who doesn't have an auto insurance policy, you could be at risk for substantial financial losses. Uninsured and underinsured motorist coverage is designed to protect against that possibility.

A handful of states require that uninsured coverage be included in all auto policies. Whatever the laws in your state, it's a good idea. Check your policy or ask your insurance professional to make sure you're covered if the other guy isn't.

Make sure you're insured

Don't go without at least a basic auto insurance policy. Even if you feel it's tough to afford it, in the long run it's for your own financial protection.

To help ensure that everyone, regardless of financial circumstances, can obtain car insurance, some states have programs to assist lower-income drivers. Check with the insurance division in your state to see if they offer such a program. Shop around and learn how you can reduce your car insurance costs and look for insurers that specialize in writing policies for lower-income consumers.

Uninsured motorist coverage

Specific options for uninsured motorist coverage vary by state and insurer, but in general there are three types of protection:

  • Uninsured Motorist (UM) insurance – Also known as Uninsured Motorist Bodily Injury (UMBI) insurance, this coverage will pay your and your passengers’ medical bills if you’re involved in an accident with an uninsured motorist who is at fault. In addition, UM insurance will reimburse you and your passengers for lost wages. UM coverage also kicks in if, as a pedestrian, you are hit by an uninsured driver, or if you’re the victim of a hit-and-run accident.

  • Uninsured Motorist Property Damage (UMPD) coverage – Uninsured motorist insurance covers bodily injuries but not damage to your car or property. For this, you need UMPD coverage, which, in addition to paying for damages to your vehicle caused by an uninsured driver, generally also covers damage to other personal property such as your house or your fence. Ask your insurance professional or state insurance department whether UMPD coverage is available in your state.

  • Underinsured Motorist (UIM) protection – In some instances, an at-fault driver may have liability insurance, but his or her policy’s limits do not cover the full extent of damage to your vehicle. In such cases, UIM insurance will cover the shortfall.


Source: Insurance Information Institute

Identity theft insurance

Tips for protecting your identity and finances

Identity theft is the act of taking someone’s personal information and using it to impersonate a victim, steal from bank accounts, establish phony insurance policies, open unauthorized credit cards or obtain unauthorized bank loans. In some more elaborate schemes, criminals use the stolen personal information to get a job, rent a home or take out a mortgage in the victim’s name.

identity theft insuranceClose to half of identity theft cases are the result of a lost or stolen wallet, checkbook, credit card or other physical document. But as online shopping becomes increasing popular, it can also pose an identity risk.

Victims of identity theft are often left with lower credit scores and spend months or even years getting credit records corrected. They frequently have difficulty getting credit, obtaining loans and even finding employment. Victims of identity theft fraud often travel a long and frustrating road to recovery; depending on the severity of the identity theft fraud damage, the recovery process can take anywhere from a few weeks to several years.

Most homeowners and renters policies provide coverage for theft of money or credit cards; however, the amount of coverage is limited (usually $200 in cash and $50 on credit cards). Once you have reported the loss or theft of your credit card to the issuing company, you are responsible for only $50 of unauthorized use.

Some companies now include coverage for identity theft as part of their homeowners insurance policy. Check your policy to find out. Others sell it as either a stand-alone policy or as an endorsement to a homeowners or renters insurance policy which can run about $25-$50 annually. Identity theft insurance provides reimbursement to crime victims for the cost of restoring their identity and repairing credit reports. It generally covers expenses such as phone bills, lost wages, notary and certified mailing costs, and sometimes attorney fees (with the prior consent of the insurer). Some companies also offer restoration or resolution services that will guide you through the process of recovering your identity.

Use of stolen credit card numbers is among the most common forms of identity theft, but some schemes use electronic means, including online scams like ‘phishing’, in which thieves use email inquiries purporting to be from financial or other online organizations, to obtain sensitive account information. Others might use more old-fashioned methods, such as ‘dumpster diving’—rooting around in people’s garbage to collect financial information.

Many credit card companies are now using radio-frequency identification (RFID) chips in their credit cards instead of magnetic stripes. The advantage is quicker, more efficient transactions, especially those carried out at traditionally cash only retail outlets, such as fast-food restaurants or convenience stores. However radio frequency identification may make it possible, in some cases, for identity thieves to use a simple electronic device to capture the information. The scariest part is that it can happen right in your presence, without you even knowing it.

Tips for avoiding identity theft

  • Keep the amount of personal information in your purse or wallet to the bare minimum. Avoid carrying additional credit cards, your social security card or passport unless absolutely necessary.
  • Guard your credit card when making purchases. Shield your hand when using ATM machines or making long distance phone calls with phone cards. Don’t fall prey to “shoulder surfers” who may be nearby.
  • Always take credit card or ATM receipts. Don’t throw them into public trash containers, leave them on the counter or put them in your shopping bag where they can easily fall out or get stolen.
  • Do not give out personal information. Whether on the phone, through the mail or over the Internet, don’t give out any personal information unless you have initiated the contact or are sure you know who you are dealing with and that they have a secure line.
  • Proceed with caution when shopping online. Use only authenticated websites to conduct business online. Before submitting personal or financial information through a website, check for the locked padlock image on your browser’s status bar or look for "https://" (rather than "http://") in your browser window. If you have any concerns about the authenticity of a Web page, contact the owner of the site to confirm the URL.
  • Be aware of phishing and pharming scams. In these scams, criminals use fake emails and websites to impersonate legitimate organizations. Exercise caution when opening emails and instant messages from unknown sources and never give out personal, financial or password related information via email.
  • Make sure you have firewall, anti-spyware and anti-virus programs installed on your computer. These programs should always be up to date.
  • Monitor your accounts. Don’t rely on your credit card company or bank to alert you of suspicious activity. Carefully monitor your bank and credit card statements to make sure all transactions are accurate. If you suspect a problem, contact your credit card company or bank immediately.
  • Order a copy of your credit report from each of the three major credit bureaus. A new law that took effect December 1, 2004, entitles you to one free credit report per year. Your credit report contains information on where you work and live, the credit accounts that have been opened in your name, how you pay your bills and whether you've been sued, arrested or filed for bankruptcy. Make sure it's accurate and includes only those activities you've authorized.
  • Place passwords on your credit card, bank and phone accounts. Avoid using easily available information like your mother's maiden name, your birth date, any part of your Social Security number or phone number, or any series of consecutive numbers. If you suspect a problem with your credit card, change your password.
  • Shred any documents containing personal information such as credit card numbers, bank statements, charge receipts or credit card applications, before disposing of them.

In order to make it more difficult for identity thieves to open accounts in your name, you can also contact the fraud department of any of the three credit reporting agencies to place a fraud alert on your credit report—by law, the agency you contact is required to contact the other two agencies. The fraud alert tells creditors to contact you before opening any new accounts or making any changes to your existing accounts. The three major credit bureaus are Equifax, TransUnion and Experian.

If you are the victim of a crime, report it to the credit card company and police immediately. Ask for a copy of the police report. You will need it if you want to file an insurance claim or report the crime to the FTC for their assistance. Victims of identity fraud can contact the FTC online or at 877-IDTHEFT.

Most homeowner, condominium owner and renter insurance policies offer identity theft coverage as an optional endorsement. If you'd like more information, please contact us.

Additional resources

Source: Insurance Information Institute

The Insurance Institute for Business & Home Safety (IBHS) offers small business owners free, user-friendly resources that can help assure their business continuity, along with checklists to help them protect their business investments and property when bad or severe weather threatens.

“No matter where in America they are located, small businesses face a significant risk from severe weather events. The good news is with some basic, thoughtful planning, these risks can be managed, reduced and often prevented from becoming true disasters,” said Gail Moraton, IBHS business resiliency program manager. She went on to note that while sources may vary, “the government estimates that 40 percent of small businesses never reopen after a weather-related disaster. Lowering that percentage by helping small businesses stay open is good for business owners, their communities, and our national economy.”

IBHS urges small business owners to use its two free, non-technical digital tools. OFB-EZ®, a business continuity tool, can help even the smallest business focus on long-term planning for any type of business interruption, while EZ-PREP®, a severe weather emergency preparedness and response planning toolkit, helps small businesses develop short-term plans for imminent operational disruptions.

“One of the most useful features of EZ-PREP is that actions are organized chronologically. If a business has adequate warning of an extreme weather event such as a hurricane or a severe storm front expected to hit their area, this tool walks them through what should be done five days before, 72 hours before, 24–48 hours before, during and immediately after the event, and during the recovery process,” explained Moraton.

Creating simple, straightforward plans using the complementary OFB-EZ and EZ-PREP toolkits enables small businesses to maximize time and focus energy during any emergency. Having a business continuity plan in place, along with an emergency preparedness and response plan, arms small businesses with the necessary tools for a rapid response to emergency situations and effective recovery.

“Small businesses are the heart of our communities. After a severe weather event, we often gather at the first open places to get goods or coffee, share stories, check in on friends and neighbors,” Moraton said. “Remaining ‘open for business’ is a demonstration of true resilience, and helps the broader community recover.”

Source: IIBHS

Summer may be winding down, but historically, the worst part of hurricane season is just beginning. Fortunately, there are simple steps that you can take to protect your wallet, your property and even your life, according to the Insurance Information Institute (I.I.I.).

September is the most common month for hurricanes making landfall in the U.S., followed by August and October, according to an analysis of weather data ranging from 1851 to 2011 by the National Oceanic and Atmospheric Administration.

“Eight of the most catastrophic and costly hurricanes in the United States occurred in September and October,” said Jeanne M. Salvatore, senior vice president and chief communications officer at the I.I.I. The other two both occurred at the very end of August, she noted.

These five actions can help you stay ready for whatever the remainder of hurricane season has in store.

  1. Review Your Insurance Coverage: Homeowners insurance provides financial protection against disasters. It insures the home itself and the things you keep in it. Because homes get upgrades and possessions get added and replaced, your insurance must reflect these ever-changing improvements. Make sure you understand what is covered and what is not covered. You need to have enough insurance to rebuild your home and replace all of your personal belongings. Contact your insurance professional and ask questions. Understand your deductibles. If you have a hurricane or windstorm deductible, make sure you understand how it works. “The time to review your insurance is before you need to file a claim,” said Salvatore. “You don’t want to find out after a disaster that you could have purchased additional coverage. For instance, many people should consider adding coverage for backup of sewers and drains or law and ordinance, which would pay to rebuild your home to current and more stringent building code standards.
  2. Consider Flood Insurance: A standard homeowners insurance policy does not cover flood damage. Flood insurance is not only for those living in high-risk flood zones. More than 20 percent of flood insurance claims are paid to those living in low- to moderate-risk flood zones. While hurricanes do bring catastrophic flooding, rain can, too. As the current disastrous flooding in Louisiana demonstrates, heavy rain might also result in destructive and deadly flooding. Flood insurance is available from the National Flood Insurance Program (NFIP) or from a private insurance company. Excess flood insurance may also be obtained from private insurance companies if more coverage is needed than the limits available from the NFIP.
  3. Conduct a Home Inventory: If a hurricane or tropical storm strikes your home, insurance companies may ask for an itemized list of what was damaged or destroyed. An up-to-date home inventory will make it much easier to file a claim. This also helps you purchase the right amount of coverage, and the documentation also may be required if you need to apply for aid after a disaster. The I.I.I. has a free home inventory app, available at https://KnowYourStuff.org/.
  4. Make Your Home More Disaster Resistant. The Insurance Information Institute for Business and Home Safety has information on things you can do to strengthen your home against a hurricane or other disaster.
  5. Know Where You Will Go and What You Need to Take If You Have to Evacuate. Advanced planning can make things much easier if you need to leave your home. This is especially important if you have children, pets, elderly relatives or anyone with special needs. The I.I.I. has KnowYour Plan software and other resources to help keep you safe.

It’s always a good time of year to talk to your insurance provider. Now may be the best of times, considering that the National Oceanic and Atmospheric Administration(NOAA) revised its 2016 Atlantic hurricane outlook, calling for the higher likelihood of a near-normal or above-normal season.

Source: Insurance Information Institute


business insurance ratesManaging and growing a successful startup takes vision, passion—and the right type and amount of business insurance, according to the Insurance Information Institute (I.I.I.). 

“Starting and maintaining a new business can be costly, but the last place business owners should cut corners is insurance,” said Loretta Worters, a vice president with the I.I.I. “Proper business insurance coverage can be critical to—and is often a requirement for—a startup’s success."

Understanding the factors used by insurance companies to price a business insurance policy is key to making the best choices when it comes to finding the right coverage for your needs. If you’re planning to start your own business, consider the following factors that can affect the price of your business insurance:

  1. Type of business How is the business legally structured? As a sole proprietor you are personally liable for all business losses and debts so you may need to get more liability coverage, but you won’t need workers compensation. An incorporated or limited liability company (LLC) poses fewer risks to individual owners.   
  2. Location, location, location Choosing a business location is perhaps the most important decision a startup will make—both from a business perspective and from an insurance perspective. Businesses located in high-crime areas, or in areas that are susceptible to severe weather, such as flooding or tornadoes, will pay higher rates.

    How to save money: Find the right location. If you have a choice as to where to locate your business, ask your agent for several quotes for the different locations you’re considering. You may find insurance in some areas to be significantly less costly than others.
  3. Facility size and characteristics A large office or factory building will likely cost more to insure than a smaller space. Insurers also take into account construction materials, so a frame building will generally have higher rates than a brick building. And they may apply a surcharge for an older building that has not had updates to major systems such as electrical, plumbing, heating and roof.  

    How to save moneyOne way to ensure more favorable rates is to set up your business in a building with state-of-the-art fire alarms, sprinkler systems and proper exits.
  4. The value of the business The value of your business lies not just in office furniture and equipment but also in its revenue and expenses. When applying for Business Interruption Insurance (BI), which covers lost net profits and continuing expenses after a catastrophe, the amount of coverage and, therefore, the premium costs will be based on your estimate of the company’s future revenues and expenses. An insurer will take into account everything when pricing a policy so make sure to keep accurate records and provide a full inventory of your stock if applicable. 
  5. Business owner’s experience An insurer will want to know how much experience the owner has in the same, or a similar, business before selling them a policy. If you’re new to the business, the insurer may apply a surcharge or simply decide not to insure you.  

    How to save moneyBring on board a partner or senior executive with related experience.
  6. Number and training of employees Depending on the state and the number of employees, most businesses are required to have workers compensation insurance—so the more workers, the higher your workers comp premiums. However, providing proper job training can help reduce the insurance costs—in many cases, a well-trained worker is less likely to have an accident.As a rule, insurers will evaluate a company for possibleworkplace liabilities before issuing a policy so previous harassment or prejudice suits against the company will impact the price of business liability insurance.  
    How to save money: Have safety procedures in place. Ask your insurance professional about any risk reduction measures that can help reduce property loss, liability, security breaches and workplace injuries. Also work with your insurer or human resources manager to set up a healthy atmosphere in the workplace and protect your company against lawsuits. 
  7. Claims history  An insurer looks at two things: the frequency and severity of previous claims.  So if a business has had several small claims or one very expensive claim, chances are you will see higher premiums.  

    How to save moneyMaintain a good loss ratio. Don’t report claims that are small; rather self-insure those that are under or close to your deductible. This will keep claims off of your record.
  8. Credit-based insurance score  A poor credit history is an indication to the insurer that the business owner may be more likely to file a claim. This can negatively affect your business insurance premiums. How to save money: Check your credit. Knowing where you stand financially will help you take steps to improve your business credit and ultimately to keep your insurance rates lower.

Worters advised business owners to keep their insurance professional informed about any changes in their business. “This includes major purchases as well as changes to your building, the nature of your operation and the number of employees. While companies can’t expect to eliminate all risks, they can try to recognize what they are and take the necessary steps to reduce them.”

source: Insurance Information Institute

Auto insurance for teen drivers

Is there a newly licensed driver in your home? Reduce the stress by understanding the implications for your car policy

For parents, the excitement of having a first-time driver in the house is usually tempered with worry. With little driving experience and raging hormones, immature drivers are at a higher risk for accidents. Of course, safety concern is uppermost in most parents' minds but other stressors—like the high cost of insuring your new driver and the financial liability implications of a teen driving mishap—can be reduced with these steps.

Before getting a learners permit, make a call to your insurance professional

Your agent or rep can clearly explain the costs involved in insuring a teenage driver. The good news is, as your teenager gets older, insurance rates will drop—providing he or she has a good driving record. Therefore…

Involve your teen in the car insurance discussion

From the outset, it's important to talk to your kid about the relationship between driving a car and the attendant responsibilities, including insurance costs. Explain and reinforce driving safety tips and the serious consequences of driving infractions or accidents, including increasing the cost of insurance.

Encourage positive behaviors

Auto insurers offer discounts or reduced premiums to:

  • Students who maintain at least a “B” average in school
  • Teens who take a recognized driver training course
  • College students who attend school at least 100 miles away from home and don't bring their car to campus

Choose the right auto insurance company

It's generally less expensive for parents to add teenagers to their auto insurance policy than it is for teens to purchase one on their own. By insuring your teenager’s car with your insurer, you may also qualify for a multi-vehicle discount. That said, insurance companies differ in how they price policies for young drivers, so do some research into prices to be sure to find the best fit for you and your teen.

teen driver autoAssign your teen to the right car

Find out how your insurer assigns drivers to cars—some insurers will assign the driver who is the most expensive to insure (generally the teenager) to the car that is the most expensive to insure. If possible, assign your teen to the least valuable car.

Note that with this kind of arrangement there can be no exceptions; your teen must use only the car to which he or she is assigned, even in an emergency. If your teenager is involved in an accident with an unassigned car, penalties could be imposed and your own premiums might increase.

Increase your liability insurance for greater protection

If your teen gets into an accident, state minimums for liability insurance will not be enough to fully protect you from lawsuits. Consider purchasing higher amounts of liability coverage—if your teenager is found negligent in an accident and the damages exceed your insurance limits, you will be held financially responsible and could be sued in court for those amounts not covered by your insurance. Depending on the value of your financial assets, you may even want to have the extra protection that a personal umbrella liability policy provides.

Raise your deductible to save on your premium

The higher your deductible, the more money you can save on your premium, so consider raising your deductible from the minimum amount required. You may want to use those savings to increase your liability insurance.

Source: Insurance Information Institute

Business vehicle risksWhether you own or lease a single business car or an entire fleet of commercial vehicles, you’ll need to purchase commercial auto insurance. Your insurance professional can help you weigh your risks and evaluate coverage options.

But even with insurance in place, you’ll want to take steps to prevent accidents and protect your employees and vehicles. Your business can reduce the chance of an accident by establishing and enforcing the following practices and policies.

Hard-and-fast driving rules

When it comes to the safety of employees and the protection of your vehicles, you should set certain firm driving rules that must be followed at all times, including:

  • Mandatory seat belt use - Nearly every state has a seat belt law. Seat belt use helps prevent deaths and limit the severity of injuries in vehicle accidents. There is no reasonable excuse for not using a seat belt.
  • Zero tolerance for intoxicants - Even one alcoholic beverage can impair a driver’s reaction time. Employees should never drink or use other intoxicants prior to using business vehicles.
  • No cellphone use - Distracted driving is a leading cause of accidents, and cellphone use while driving is banned in some states. Prohibit employees from taking calls or texting while driving.

Vehicle use guidelines

Other rules may be more flexible, but you should consider instituting policies and adhering to the following practices yourself as appropriate:

  • Limit non-business use of vehicles - While some employees use the same car for work and personal use, generally limit business vehicle use to work-related travel.
  • Slow down - Scheduling should allow sufficient travel time between meetings and assignments. Do not create such a frantic pace of work that employees are encouraged to speed. In addition to reducing the risk of accidents, driving the speed limit also will help control fuel costs.
  • Lock and secure vehicles - Employees should always lock vehicles when on the job. Whenever possible, vehicles should be parked in secure, well-lighted areas.

Employee-focused practices to reduce vehicle risk

  • Know your employees - Before hiring employees to drive company vehicles, check their driving record with the motor vehicle department for past infractions. Limit or ban driving by employees with a history of accidents or moving violations. Employees should also be required to report any accidents they have while not working. In addition, recognize that some personality traits—such as a bad temper—can raise the risk of auto accidents.
  • Provide training - Employees who regularly drive work vehicles—or are taking on a new assignment requiring vehicle use—should be provided with drivers training. This course may just be a refresher for some, but it should cover key safety practices such as following distances and proper backing techniques.
  • Recognize safe drivers - For businesses in which driving is central—such as a florist or a moving company—establish a program to recognize and reward safe drivers. You may also want to reward a department or the whole company for accident-free periods.

Responding to an accident

The above practices and policies can help minimize the risk to your business vehicles, but they cannot entirely prevent accidents from happening. If a business vehicle is involved in an accident, you’ll want to help your employee-driver respond appropriately and proceed with filing an insurance claim. The following practices and steps will help your business and the involved employee recover and get back to work.

  • Establish procedures in the event of an accident - Employees using company vehicles should be trained what to do if an accident occurs. This includes not leaving the scene of an accident, contacting the police, and collecting information (license plate numbers, contact information, insurance information, etc.) from the affected parties and any witnesses. The accident should also be reported to appropriate personnel at work. Consider using the incident as an opportunity to educate all employees who drive company vehicles about what to do if they are involved in an accident.
  • Contact your insurance professional and file a claim with your insurer - As soon as possible, contact your insurance professional to report the accident and begin the claims filing process. It’s especially important to work immediately with your insurance team if anyone has been injured in the accident. Follow the guidance of your insurer in a timely manner, such as getting estimates for repairs.

Remember too, that auto insurance claims are not limited to accidents. You may also need to file a claim if your vehicle is vandalized, stolen or damaged from an event other than an accident, such as fire or severe weather.

Source: Insurance Information Institute

Where you travel, the vehicle rented, the rental contract and other factors can all impact coverage, so it really depends on the situation. Below is a general overview, as it relates to a Massachusetts Auto Policy (MAP), of issues to consider.

  • A MAP is not worldwide. It only covers you in the U.S., it’s territories, Puerto Rico and Canada.
  • As long as you have comprehensive and collision coverages on any of your own vehicles, it would cover physical damage to the rental car. Note that this only applies to a 'private passenger vehicle'. A U-Haul truck or 10 person passenger van are commercial vehicles and would not be covered.
  • Some rental companies limit where a vehicle can be operated. Driving the car beyond these limitations violates the contract, and your insurance would not cover.
  • Most rental agencies require all drivers to be listed and paid for at time of rental. If you allow anyone else to drive and there is an accident, there is no coverage.
  • Most rentals consider the rental contract void if driving under the influence. This also voids coverage. MAP excludes “regular use” of another vehicle. If you rent for an extended period, it’s best to check with your insurance company. To avoid this issue, you can add a “Use of Other Autos” endorsement for the rental period and then have it removed.
  • Many rental companies often require the auto to be replaced with a new one if a total loss occurs. The MAP only pays for Actual Cash Value not Replacement Cost, which is something to consider.
  • If you damage a car and it can’t be rented to others, the rental agency may expect you to pay for lost rental time. Loss of use is not covered by a MAP.

The Collision Damage Waiver (CDW) offered by the rental company can be a solution for situations not covered by your auto policy. However, you should never assume that the CDW absolves you of all issues. Always read the contract and clearly understand  what is and what is not covered. Also, if you rent a car using a credit card that offers some type of insurance protection, be sure to read the contract and understand coverage limitations.

If you’re planning to rent a car, our Associates are always glad to review specifics of your auto policy protection. However, it’s ultimately your responsibility to understand the terms and requirements of the rental contract and determine if your policy provides the coverage you need.


The information provided in these articles are only general descriptions and should not be relied upon as complete, correct or accurate for your specific situation. All coverage informaiton is subject to policy provisions, endorsements and may be  subject to your meeting underwriting qualifications. Murphy Insurance Agency is not engaged in rendering legal, accounting or other noninsurance professional services. Consult an appropriate professional for advice regarding your own situation.